Because a guardianship of the estate is so closely scrutinized by the Courts to ensure the appropriate use of the Ward’s funds for the Ward’s benefit, the Probate Code requires that a guardian have approval from the Court for all expenses prior to expending those funds. When seeking the Court’s approval of proposed expenditures, the Court will be looking to determine if the expense is 1) reasonable and necessary for the Ward and 2) in the best interest of the Ward. If both of these conditions are met, then the Court will approve the expense.

Since many Wards will have regular, recurring expenses on a monthly basis, the Court can approve a Monthly Allowance. The allowance is essentially a pre-approval from the Court to expend certain sums each month during an accounting year for certain categories of expenses. For instance, the guardian may know that the Ward’s rent for the next year will be $500 per month, his food will cost approximately $300.00 per month, medications run $250 per month, etc. Because it would be impractical to seek the Court’s approval each month for these recurring expenses, the Court will grant the guardian the right to expend up to the requested amounts each month. Only when the anticipated expense will exceed the pre-approved amount does the guardian need to go back to Court and ask for additional approval.

If the guardian fails to obtain the Court’s approval prior to spending money out of the Ward’s estate, the guardian can be held liable for the funds expended if the Court determines that the funds were not spent properly or were not reasonably necessary for the care or benefit of the Ward. Probate Courts are very concerned about making sure that the Ward’s money is spent solely for the benefit of the Ward.

If a guardian is determined to be liable for improper expenses, then either the guardian or the company that issued the Guardian’s Bond will be required to reimburse the estate for those expenses. Generally, such a reimbursement will also mean that the guardian will be removed from serving as the Guardian.

Because of the continual maintenance and monitoring required of guardians who serve over estates of incapacitated Wards, many law firms are not equipped to properly keep track of the expenses of the estate or the approvals required for these expenses. Likewise, many law firms are not equipped to adequately advise their clients on these issues. Ford+Bergner LLP, however, advises clients on these issues frequently, and we will be glad to assist you if you have been appointed as the guardian of the estate of a Ward.